Following the change in Government last year, it goes without saying there are many legislative changes employers need to be aware of.
The majority of the reforms are contained within the Employment Rights Bill, which is expected to take effect in 2026.
We have set out the key changes that are expected below.
1. Day One Right Against Unfair Dismissal
Under the current legislation, employees are required to have worked 2 continuous years before they acquire the majority of employment rights, including the right not to be unfairly dismissed.
The proposals contained within the Bill are set to scrap the 2 years’ service requirement and make unfair dismissal a day one right.
This adds additional protection for employees, giving them the right not to be unfairly dismissed from day one. However, this is likely to result in employers carrying out enhanced due diligence before recruiting.
From an employer’s perspective, it is important that contractual terms and policies are reviewed ahead of this change to ensure that a robust system is in place to manage performance and conduct, where required, to minimise risk in respect of dismissal claims.
2. Tribunal Time Limits
Currently, an individual needs to bring a claim in the Employment Tribunal within 3 months for the majority of employment related claims.
As part of the reforms, we expect to see this time limit extended from three months to six months, which has been outlined in the draft Bill and the accompanying ‘Next Steps’ document.
This change is inevitably going to lead to an increase in claims brought in an already struggling Tribunal system.
3. Restrictions On Fire And Rehire
‘Fire and rehire’ is a term used in practice where an employer changes an employee’s terms and conditions by terminating their employment and re-engaging them on new terms.
In October 2024, the Government implemented a new Code of Practice on “fire and rehire” which encouraged employers to act fairly and responsibly. However, the Code did not introduce legally binding obligations to prohibit ‘fire and rehire’ from taking place.
The Bill is set to implement heightened measures to restrict employers from dismissing an employee for refusing a variation to their terms of employment.
This means there is going to be additional risk on employers seeking to vary terms and conditions of employment. If you’re planning on varying an employees’ contract, we strongly recommend that you seek legal advice first.
4. Harassment
From 26 October 2024, a new duty on employers was introduced to take reasonable steps to prevent sexual harassment in the workplace. Employers must put in place steps to prevent sexual harassment which extends beyond employees to third parties, such as clients or suppliers.
If an individual raises a complaint of sexual harassment, it is to be treated as a proctected characteristic under the legislation surrounding whistleblowing.
If you are unsure on what reasonable steps you need to take to prevent sexual harassment, or if you feel your employer has not taken reasonable steps to prevent sexual harassment, please contact our Employment Team today.
5. Increase In Minimum Wage
The National Living and Minimum Wage rates have increased from 1 April 2025. The new rates are as follows:
- National Living Wage (21+) – increase from £11.44 to £12.21 per hour;
- 18 – 20-year-old – increase from £8.60 to £10.00 per hour;
- 16 – 17-year-old – increase from £6.40 to £7.55 per hour; and
- Apprentices – increase from £6.40 to £7.55 per hour.
How Can We Help?
If you have any questions as to how these changes may affect you as an individual or your business, please don’t hesitate to contact Hatchers Solicitors’ Employment Law Team on 01743 248545 or mail@hatchers.co.uk.
